Business alliances often begin simply, sparked by a meeting at a networking event or a referral from a trusted associate.

But getting together -- and then staying together -- in a successful business alliance in the life/health/benefits marketplace doesn't happen by accident. But just how do business alliances work -- and not work?

A panel discussion at an industry event (the Inter-Company Marketing Group 2009 annual meeting) highlighted key elements that can turn potential business partners into effective business partners:

• There is a similarity between marriage and a business alliance: Both require dating, mating and staying in love. So observed Terry Young, vice president-group business development, at Ameritas Life Insurance Corp., Lincoln, Neb., which offers group dental and vision products.
• When business partners are seeking prospects for their alliance, who's going to do what? That's a key question that has to be asked and answered up front, noted Steve Course, vice president-marketing, BEST Life & Health Insurance Co., which provides group dental, medical, life, and disability products.
• Make a plan to learn right away once an alliance starts, noted Bruce Maginnis, group benefits consultant, Gilsbar Inc., a third-party administrator. "We find there are all kinds of things we didn't know about and the business partner didn't know about" once the alliance begins to do business. Maginnis said: "Relationships are defined when something goes wrong. You want a partner that will work things out together. It's not 'my problem.' It's not 'your problem.' It's 'our problem.'"
• The premiums generated by the life, health, or benefits product must be sufficient to 1) provide the level of client service that can keep the client base, and 2) generate the returns that can keep the business partners interested, noted Maginnis.
• Tom Mayer of Direct Benefits Inc., a managing general agency, noted that carriers need to understand how "expensive" distribution is if they want to succeed in joint ventures. "If you have a good partnership going, reinvest in it. Some carriers don't get that."
• Try to understand how the business partner's operations and people work, recommended Course. "You've got to understand each other's cultures. Knowing what the two parties' cultures are, and how they fit, determines whether deal works."

Those are a few thoughts from professionals involved in effective strategic alliances. We'll be back with more insights in a future blog post.